EU sounds alarm on Chinese shoes
(China Daily)
Updated: 2005-06-09 08:37

An attempt by European footwear makers to launch safeguard measures against China cannot be justified, according to sources from China Leather Association.

China's footwear exports to the European Union (EU) reached 257 million pairs in the first three months this year, up 2.8 per cent year-on-year, while the total value hit US$726 million in this period, up 30.8 per cent from the previous year, said statistics from China's General Administration of Customs.

"This figures shows that China's exports have not imposed a severe impact, which the European companies claimed, on the market of European countries," said Wei Yafei, a spokeswoman with the association. "Such a slight increase will not do harm to local industries, either."

Footwear manufacturers associations of Italy, Spain and Portugal are reported to have filed applications to the EU to curb footwear imports from China. It is the third time that the Italian association requested to initiate protectionism against Chinese shoes in the past six months.

They claimed that imports from China had flooded their markets and hurt their domestic industries. Their move is supported by companies from France, Greece and Poland.

However, the European Commission is not predicted to take an immediate measure against Chinese footwear.

"As the commission is busy with the textile frictions with China, it might not launch an investigation toward safeguard measures against Chinese shoes in one or two months," Wei said.

In order to collect information for the possible safeguard measures or anti-dumping charges, the EU has implemented a new mechanism towards footwear from China since February 1, requiring the shoe importers to apply for the permits from governments of any EU members. This system covers all items under the quota regime, which was lifted from the beginning of this year.

If the EU testifies that there exists a great surge of Chinese shoes in its market, it would take measures to protect the domestic businesses.

"That will be a heavy blow to China's shoemaking industry," said Wang Jin, an official with China Chamber of Commerce for Import and Export of Light Industrial Products, Arts and Crafts.

The European Union is the second largest market of Chinese shoes, accounting for some 14.6 per cent of the country's exports. China exported about 800 million pairs of shoes, worth of more than US$2 billion, to the EU last year.

The Chinese Government and the industrial associations have carried out series of measures to watch the footwear exports and strengthen self-regulation among the sector.

China's trade watchdog, the Ministry of Commerce (MOFCOM), has also put shoe exports under close supervision.

A special team has been established under Wei's association to deal with trade conflictions in this sector and inform the manufacturers of the latest information.

They are also considering restrictive measures similar to those on the textile exports.

Similar to Chinese textile industry, the country's shoemakers have been amid tensions of trade conflicts with trade partners since last fall just before all quotas on footwear trade were to be eliminated.

At present, China produces more than 6 billion pairs of shoes annually at over 7,000 shoemaking enterprises.

A great proportion of them are OEM (original equipment manufacturing) products for international brands.

The bad practice of some small and medium-sized enterprises has increased the risk of anti-dumping and safeguard measures.

China's shoe exporters, the experts said, should not just eye the thin benefits under their noses but should make a long-term strategy.

Wang suggested Chinese shoemakers develop high-end markets and produce shoes with high added value.

She urged enterprises to add more value to their products and establish their own brands instead of merely tailoring the profit margin.

Wei also expected more Chinese footwear manufactures to restructure their business and develop the brands of their own.

"The statistics from the customs has shown a good trend that the unit price of Chinese shoes are increasing," She said.

So far, some Chinese companies have started to carry a brand strategy and are sticking to the high-end overseas markets.

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